Based on promising in vitro and in vivo data, the applicants are developing novel classes of compounds with anti-inflammatory effects, and with anti-arthritic potential. In this proposal, we present evidence that selected ligands of the adenosine-3 receptor are (1) inhibitors of the production of macrophage-derived pro-inflammatory mediators and enhancers of the production of anti-inflammatory mediators in vitro and in vivo (2) potent anti-inflammatory agents in a variety of inflammatory conditions including collagen-induced arthritis, and endotoxin-induced systemic inflammation. The applicants intend to develop a selected adenosine 3 receptor agonist as an anti-arthritic drug. The applicants have collaborated with a prominent group in the field of adenosine receptor ligands, and have identified candidates, with selectivity towards the adenosine 3 subtype in human systems, which are deemed suitable leads for further drug development, efficacy studies, and eventual formal pharmacokinetic and toxicology studies. The specific aims of the present proposal are (1) to identify a lead adenosine-3 ligand, with acceptable efficacy profile in human systems (2) to perform efficacy studies with the compound in terms of suppression of pro-inflammatory mediators in human cell systems (3) to synthesize larger, GLP and GMP-quality quantities of a lead adenosine-3 agonist compound, and (4) to perform in-house and subcontracted pharmacokinetic and toxicity studies in two species according to FDA requirements. The current scope of work will bring the applicants forward to the level of an IND application for Phase I clinical testing of a selected adenosine-3 ligand. PROPOSED COMMERCIAL APPLICATION: The domestic market for a novel, effective therapy for arthritis is estimated at >$1 billion per annum. Global markets are estimated at $4 billion. Current market entrants are incompletely effective: Arthritis-related morbidity is substantial, with chronic disability, loss of employment, and exercise intolerance. A novel A3 receptor agonist may represent a useful anti-inflammatory adjunct to current therapeutic regimens; funding of the current SBIR Phase II will allow for starting human safety trials in 2 years.